Buried in this story on the impasse over the extension of jobless benefits is a nugget about a misleading study from the Federal Reserve Bank of San Francisco — a citation that lacks anything in the way of context or explanation:
Economists worry that months of jobless benefits discourage workers from finding work. Researchers at the Federal Reserve Bank of San Francisco calculated this year that extended jobless benefits kept the unemployment rate about 0.4 percentage points higher than it otherwise would have been — a figure that translates into more than 600,000 extra people on the unemployment rolls. Still, they called the impact “relatively modest.”
The question this should raise is how did the Fed arrive at this figure? What were the assumptions used and how were the numbers crunched? Without knowing these things, it is hard to know what to make of such a finding.
The other issue I have with the use of this statistic is that it comes within a story that lacks any discussion of the actual jobs picture. We know that people are out of work — USA Today quotes them — but the paper fails to give us a sense of the actual job market. How many applicants are there for each job opening? How many new jobs have been created? How does that match with the number of people who are in the workforce?
It’s painful that the unemployment discussion always seems to move forward in this kind of vacuum.
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